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Wednesday, September 28, 2011

Papandreou and Obama - too soft?

Just like other members of the Greek elites, Papandreou easily outclasses the people sitting with him at the same table in Brussels and/or other European capitals. He gave a speech in Germany yesterday where Merkel and the head of the German Industrial Association also spoke. The latter came across like a German professor from the text book; Merkel came across as the "Mutti" that she is perceived as; and Papandreou was the "sir". A German journalist commented with a strong German accent that Papandreou spoke “good English”. Great observation!

Papandreou’s fault is that he doesn’t come across as “calling the shots”. He comes across more like the fatherly figure who tell his compatriots that they don’t have an alternative. This hurts so much more in as much as Greece actually has the stronger cards in the present game of chicken. He knows that, one way or the other, Greeks will have to accept a much lower standard of living than before. The only question is whether this happens radically (Euro-exit) or gradually.

Greece has very little to lose except the positive image which Papandreou projected in the last 3 years. Someone told me that out of the last 100 years or so, Greece has been in default 2/3 of the time. Another default won’t hurt Greece as much as the rest of the world.

Papandreou ought to give a Churchill-like speech to his compatriots telling them something like the following: “We now have a long-term industrial development plan for the Greek economy which will turn Greece into a competitive, market-driven economy. To accomplish that, we need the help of banks and the help of the EU. We have already informed them what kind of help we need and we expect them to comply because they all must have a strong interest in Greece’s becoming a value-generating member of the EU. They simply cannot allow Greece to become an underdeveloped region of Europe living on money transfers from other countries because that would hurt them more than us!”

And then he should add something like “When should it be done if not now? Who should do it if not us?”